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GST maze leaves exporters sulking for refunds In its 22nd meeting on October 6, the Goods and Services Tax (GST) Council had asked the government to quickly refund to exporters the Integrated GST (IGST) paid on goods exported.Finance Minister Arun Jaitley announced that refunds will start from October 10, for exports made in July, and from October 18, for exports made in August. However, most exporters have so far not received refund of the IGST paid in July or subsequent months.The Central Board of Excise and Customs (CBEC) issuedacircular on November 7, stating that refunds of the IGST paid on export goods cannot be made in many cases due to errors in export report/manifest (EGM), shipping bill and GSTR1 returns of outward supplies for July The CBEC said that common errors include incorrect shipping bill number in July GSTR1 (that can be corrected only through Table 9 of August GSTR1), mismatch of invoice number and IGST paid amount in the shipping bill and GSTR1, mismatch of informati…

Manufacturing activity pushes up GDP growth Manufacturing activity in India rebounded in the second quarter (Q2) of FY18, as companies ramped up production to meet the festive demand, pushing up overall economic growth.Investment activity also witnessed an uptick after lackluster performance in the last two quarters.

Over the last two quarters, economic growth in India had slowed down, as the economy dealt with the twin shocks of demonetisation and the goods and services tax (GST). But gross value added (GVA) rebounded in Q2 FY18, growing by 6.1 per cent, up from 5.6 per cent in Q1. Core GVA, which excludes agriculture and government spending, grew by 6.8 per cent —up from 5.5 per cent in Q1, as government spending slowed down sharply.It had dipped toalow of 3.8 per cent in Q4 FY17.

This rebound in growth is driven by the manufacturing sector.The sector grew by 7 per cent in Q2, adding 1.28 percentage points to growth.In the previous quarter, manufacturing value added had grown byamere 1.…

Remove long term capital gains tax exemption Bourse says exchequer could be losing Rs 49,000 cr a year One of the most important stock market participants is making a case for reinstating of long-term capital gains (LTCG) tax on equity investments. According to sources, the BSE has made a presentation to the Union finance ministry that LTCG exemptions cause huge revenue loss to the government and also lead to market manipulation. LTCG is tax-exempt on the sale of listed securities, since 2005. This had made India one of the most liberal markets in this regard, the BSE said in a presentation last Friday. LTCG are profits on sale of shares on a stock exchange platform after a holding period of at least a year. Short-term capital gains (STCG) are profits on sale of shares held for less than 12 months; these are taxed at a flat 15 per cent. “Since India has one of the lowest tax collection to GDP (gross domestic product) ratio within G-20 countries, every effort must be taken to shore up the …

Narendra Modi signals use of Aadhaar to track benami properties Implicitly, PM Naredra Modi suggested that the govt may not just insist on linking Aadhaar with the registration of new properties but that even existing properties will have to be re-registered Prime Minister Narendra Modi on Thursday warned tax evaders that the government will broaden the scope of Aadhaar, the 12-digit unique identification number, to crack down on benami properties. “Aadhaar will now be used against benami properties and this will become a big weapon for the government,” Modi said at the 15th HT Leadership Summit. Implicitly, the prime minister suggested that the government may not just insist on linking Aadhaar with the registration of new properties but that even existing properties will have to be re-registered. If implemented, it can be a potentially disruptive move. Benami properties are assets held in the name of another person or under a fictitious name to avoid taxation and conceal unaccounted-for, …

Growth in Q2 could be higher as GST revenues still pouring in Chief statistician TCA Anant on Thursday said India’s economic growth in the July-September quarter could be higher than 6.3% as indirect taxes are still being collected on account of the goods and services tax GST) which was rolled out on July 1. “It is likely that when revised estimates are prepared, indirect tax collections for this period may actually be higher than what we have reported,” Anant said at a press conference while admitting that the GST introduced a “certain level of statistical challenge” in compiling the growth numbers. India’s growth as measured by the gross domestic product (GDP) was 6.3% in the second quarter, up from 5.7% in the previous quarter which according to Anant “shows a significant trend reversal in growth rates, indicating it is returning to more normal levels”. He said manufacturing has shown a revival and capital goods production has picked up but construction continues to be slow but is expe…